Cap Rate Prompts 200,000-SF Buy

HOUSTON-A high cap rate and low price per square foot prompted Hartman Income REIT to make its first buy of 2009, that of two class B office buildings in the northwest submarket. Koll Bren Schreiber Realty Advisors of Newport Beach, CA sold the assets, which totalled 199,899 square feet, for well above an 11 cap.

REIT president Allen R. Hartman tells GlobeSt.com both the 128,891-square-foot Northchase Center at 14550 Torrey Chase Blvd. and the 71,008-square-foot Cornerstone Plaza at 3707 Farm-to-Market 1960 West located one mile east are well-maintained assets, with occupancies between 90% and 92%. Tenants at Northchase Center include Valassis Communications, Inc., Frontline Group and Discount Tires, while Cornerstone Plaza has McDonald’s Corp. as well as other tenants.

Hartman acknowledges the portfolio is a somewhat unusual buy for the REIT, which focuses on office buildings and shopping centers with a value-add potential. The deal’s appeal involved the cap rate and price per square foot.